Homes, Homes, We Need Homes!

The U.S. economy is a mess. The continuing coronavirus pandemic has led to scores of business closures, the worst unemployment since the Great Depression and the steepest economic contraction on record.

Yet, despite it all, the U.S. housing market has been spared and is experiencing a record year. In our valley, well, it can only be described as “hot” and the best real estate market since 2005 for sellers. Cooped-up buyers are seeking larger homes, first time home buyers want to cash in on record-low mortgage interest rates, and escapees are fleeing large metropolitan areas with the newly given option of working from home. They are all battling it out over a very limited supply of properties for sale or for rent in our valley.

Because of the demand, home sales and home prices are both on the rise. Homes sales in Jackson County grew by 9% for the 3rd quarter with 381 homes selling per month. Home prices increased by 11.3% in the same quarter, bringing a total increase in home prices to 42.4% since 2015. However, inventory dropped 64% over last year and we are down to 342 homes for sale, which is less than a month’s supply. We are experiencing the highest demand combined with the lowest inventory in the 18 years that I have been a Realtor. On the rental side, we have seen vacancy rates lower than 1% throughout the year.

In the midst of this record demand and low supply, we experienced the most devastating fires in our recent history – the Almeda and Obenchain fires, which destroyed well over 2,000 homes. So, now our valley desperately needs homes for fire victims as well as retirees, escapees and for those who seek to downsize or upsize. Every week our property management department gets scores of calls for rental housing and we have very little available. On the sales side, we watch buyers pounce on every home that becomes available. Some homes, especially under $350,000, are getting as many as 8 to 10 offers, so one buyer gets the home and 9 buyers lose out. Our valley desperately needs more homes for sale and more homes for rent to keep up with the demand on both.

It may take years to catch up to the housing demand but we can start today and we can all help. Expert Properties is helping by waiving six months of management fees for any owner that has an empty cottage, ADU, or vacant home that we can rent out. In addition, we are donating $1,000 per listing sold to local charities helping fire victims. If we all chip in, we can help our valley heal. Details of these promotions are printed on the back page of this publication.

Another encouraging change is that we are seeing our cities increase the number of acres that are zoned for Multi-Family Residential (MFR), allowing more homes to be built on one lot. This will increase the number of duplexes, triplexes and townhomes being built and accommodate more families in need of housing.

In a similar move, the City of Grants Pass is now allowing two Auxiliary Dwelling Units (ADUs) to be built on each city lot, provided there is space and you meet all the requirements. To help lower the cost of these ADUs, the city planning department has posted pre-approved ADU plans on their website that can help you get started. There has also been a lot of talk in the Oregon State congress to allow one ADU to be built on each rural lot located in our counties. To my knowledge, this is still in the talking stages.

With demand for homes booming and supplies dwindling we face a major shortage in homes for sale and for rent. Government needs to do their part by reducing restrictions and speeding up building approvals. We can do our part by renting our vacant homes, ADUs, cottages not in use and donating what we can to rebuild homes lost to the fires that were uninsured or underinsured. If we all work together, we can increase the supply of homes, help those who lost theirs, and continue to see our valley prosper.

If you'd like more information about listing your home, contact us.

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Almeda Fire Relief

If you have a property available in Southern Oregon, or want more information on listing your home for sale, please call a phone number above or contact us.

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When is the Best Time to Sell?

In Southern Oregon, you hear a lot about a summer selling season for real estate. Or you hear it’s best to list your home in the winter when there is less competition. Both statements have a ring of truth, but there is a lot more behind the numbers.

The year generally starts out slow, and you can see below that last year, 718 existing homes sold in the first quarter, taking an average of 51 days to sell. (Interesting note, 2020 has started with less than 800 existing homes for sale). It is true there wasn’t much for sale in the first quarter. You can see below that we averaged less than 1,000 homes for sale but low inventory didn’t help sellers or buyers. Even with low inventory, only 24% of the homes sold, taking an average of 51 days to sell.

Then comes spring and summer when the majority of sellers list their home, and the buyers have the greatest selection. Many sellers don’t want to list their homes until the grass turns green, the blossoms bloom and the sun comes out to stay. By far, we have our greatest selection in spring and summer, which is good for buyers, and we have the most buyers which is good for sellers. You can see that over 1,100 homes sold in both spring and summer and buyers had over 1200 homes to choose from. Bottom line, about 30% of all homes for sale in spring and summer sold, and they sold, on average, in 43 days.  

Lastly, fall rolls around and a lot of homes that were for sale, have sold. We still have a large number of buyers but the buyers have less homes for sale to choose from. Last year, existing homes for sale dropped to 783 by December, and a record 37% of them sold in about 48 days! For buyers, there isn’t much selection, but for sellers, Fall is when sellers have the greatest chance to sell their house. 

Being that the largest percentage of homes that are listed sell in the 4th quarter, you might think that fall is the best time to list your home for sale. That’s true, but, there is one more equation.  The price of the home being listed is a huge factor in determining how long it will need to be on the market before finding the right buyer. If a home is over $500,000 or $600,000, the average number of times you need to show your home before you find the right buyer is huge. Southern Oregon is a small area and we have a thriving real estate market, but higher end homes are a niche and it takes time to find the right buyer. In Jacksonville and Ashland, it takes over 26 showings before you get an offer. This is because homes in Jacksonville and Ashland average well over $400,000 where the buyers are limited. In many cases, it takes six to eight months to find the right buyer and it will take six to eight months before you have 26 interested buyers. 

So Fall is the best time to sell your house with the least amount of competition and the most amount of buyers per listed home, but do remember if your home is over $500,000 or $600,000 it still may take a lot of showing before it sells. 

Have questions about the best time to sell? Let us know:

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Recession, Depression, Pandemic, Oh My!

As we slowly return to normal, and we can find toilet paper in the stores and restaurants with open doors, we do have to wonder if we’ll ever be the same. 

I look back on my life and how all the economic events shaped it and changed its course. I know our current pandemic, and resulting recession, will most likely have as much or more effect as past events in my life. I can only guess what the long lasting effects will be, but I wouldn’t be here if it wasn’t for the past economic events shaping the course of my life and creating the road I took. 

The first economic event that changed the course of my life was the boom, then the subsequent bust in early 2000’s. I was living in the San Francisco bay area and had started a web development company that I named eBusiness Design. We helped pre-existing and new companies develop and implement their online strategies. There was an incredible boom and massive growth in the use and adoption of the internet and business was booming. Money flowed in from investors all over the world to fund start-ups. At the peak, the NASDAQ index rose 400%, only to come crashing down 78% from the peak by October 2002 creating the first recession that changed my life. Needless to say, most of my business with companies disappeared and the majority of companies in the high-tech field were economically devastated.  Knowing high-tech would not recover for a few years, I had to reinvent myself and my career. I have always vacationed in Southern Oregon and it was my favorite place to visit, so it made sense, if I was going to start over, I should do it in a place I loved. Because I love our area so much, I knew I would be good at selling Southern Oregon and that is exactly what I did. I moved to Southern Oregon, became a Realtor, and started selling Southern Oregon all because of a recession that had changed my life. 

The next economic event that changed my life was the real estate crash and recession of 2007. Whether you call it a recession or depression, millions of families lost their homes all because of excessive speculation in the housing market combined with poor oversight of the lending institutions. I went from selling over a hundred homes a year to just a few. Home prices declined so quickly that buyers were understandably scared off and homeowners gave their homes back to the lending banks as their home values became less than what they owed. My partner and I sat down and asked ourselves how are we going to survive this housing crash? We knew we couldn’t sell most of our client’s homes because they owed more than we could sell their house for. Our idea was, if we can’t sell our clients homes, we could rent them out, cover their mortgage cost until home prices increase and then sell them. We were worried that the depression and growing unemployment rate would cause the rental market to drop but the opposite happened. So many families lost their homes and entered the rental market that the demand outstripped the supply and rental prices went up. Fast forward to today and home values far surpassed 2007 values and are increasing by about 6% a year. Many of the home owners who chose to rent out their homes in 2007, are still renting them out through us
and enjoying a monthly income stream.  Some of our clients have purchased additional rental homes and have become true real estate investors. Now we sell real estate, have a property management company and a short term furnished rental company for travelers and house hunters. Again, my life was changed by economic events out of my control.

This brings us to the current pandemic and the recession it has caused.  How will this change our lives, what will be different moving forward? During the pandemic, millions of American workers were forced to work from home. In many cases the employees have been more productive and enjoy not commuting. We are already seeing more buyers from California looking to move here while continuing to work for their California based employers. It’s very likely we will see more employees working from home and having the choice to live where they want to live and not where their company is headquartered.  

Life has seemed to slow down, I have less desire to go out all the time and I have no desire to be in large crowds. Spending time at home with my family seems more inviting than it has been in the past. I don’t want to leave my little town of Jacksonville and I want to support all of our local merchants and not national restaurants and big box chain stores. Community now seems more important, and traveling less inviting. I’m happier to be where I am today and thankful for the past events that created the road that got me here! 

Buyers: Are You Ready for a Bidding War?

With businesses reopening throughout the country and some experts indicating early signs of a much-anticipated economic recovery, more homebuyers are actively entering the housing market this summer. Today, housing is truly driving the U.S. economy forward. With so many buyers looking for homes to purchase and so few houses for sale right now, there’s a disconnect between supply and demand. This imbalance is pushing home prices upward while driving more bidding wars and multiple-offer scenarios. Danielle Hale, Chief Economist at explains:

People are surprised that prices are rising, not falling, because in the last recession home prices fell, the difference this time is the severe shortage of homes for sale…We are seeing bigger price increases with [a limited] number of homes…That is likely to lead to more competition and potentially multiple offers and bidding wars.

According to the recent Realtors Confidence Index (RCI) survey conducted by the National Association of Realtors (NAR), this trend is growing:

On average, there were about three offers on a home that closed in May, up from just about two in April 2020 and in May 2019 (2.3 offers).

HousingWire also indicates:

“42% of homeowners who made a purchase during the January to May time period ended up in a bidding war, demonstrating the strong demand for homes amid low inventory.”

With more people returning to work we’ll continue to see the number of interested buyers increase. So, if you’re among the many people looking for a home to buy this summer, it’s important to ensure you have the right guidance from the start. This way, you make sure your offer stands out from the crowd when it really counts. Here are two tips to follow.

1. Hire a Trusted Local Expert

A trusted local real estate professional matters more than ever right now, as noted in a recent survey shared by NAR. In fact, according to respondents, 54% of buyers and 62% of sellers indicated that Particularly during the pandemic, a real estate agent’s guidance is especially valued.
We’re not in a normal market. We are in one of the greatest health crises our nation has ever seen. The pandemic has had a dramatic impact on the journey consumers must take to purchase a home. To successfully navigate the landscape today, you need a true expert on your side. (Hello! That’s where we come in!)

2. Get Pre-Approved for a Mortgage

When there are more buyers than sellers on the market, the process to find a home becomes much more challenging. One way to show you’re serious about buying a home is to work with a lender to get pre-approved for a mortgage before starting your search. With a pre-approval letter, sellers will see your true desire to buy this year, potentially helping your offer rise to the top.

Bottom Line

If this is the year you’re ready to buy, let’s connect to get the process started so you can make sure your offer is a strong one when the competition heats up.

Need an Expert to help you navigate this crazy market? Let us know.

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Home Prices Rise During Pandemic… Will it Continue?

The economy is shrinking, businesses are closing and jobs are disappearing due to the coronavirus pandemic. But in the housing market, prices keep climbing higher.

Home prices plunged during the last recession after the 2007 housing crash caused millions of families to lose their homes, but that hasn’t been the case this time. The median home price nationwide rose 8% year-over-year to $280,600 in March, according to the National Association of Realtors. In the same period, in Jackson County, the median home price rose 11.5% to $310,000. While buyer demand has softened during the pandemic, the number of homes sold has fallen by over 30% in Jackson County; but the supply of homes on the market is contracting even faster. Demand is outstripping supply, causing prices to rise. Homes priced under $350,000 are often seeing multiple offers and selling in a few days. Higher-end homes, over $600,000, are still waiting for more out-of-state buyers to arrive. Here in Jacksonville, it’s another story. Even though active listings are down by 27%, we have seen the number of homes sold increase by 84% year-to-date.

For the first time in my career, I’m seeing out-of-state buyers purchasing homes without seeing the home in person. They are making offers on homes after viewing the listing online and viewing a walk-through video. In one case, a retiring couple had their brother, who lives in Jacksonville, walk through a home and make a final decision for them. Many others are calling to inquire on homes but waiting for stay-at-home orders to ease before deciding whether to make the trip to buy. Once the states lift their stay-at-home orders, we will see how home sales are affected. It’s hard to say what the world will look like post-pandemic, but it will change many people’s’ behavior.

On one hand, the cancellation of the Oregon Shakespeare Festival and the Britt Festival will mean the loss of thousands of monthly tourists who often decide at the end of their vacation to move to our area. But, on the other hand, thousands of families and retirees will most likely decide to move out of crowed metropolitan areas in favor of smaller, safer communities like ours. Southern Oregon lacks job opportunities, but many employers may be more open to their employees working from home after favorable experiences during the pandemic.

Bottom line: the housing market has been under-supplied for years and during the pandemic it has gotten worse. We are currently facing lots of demand for housing which will increase as the pandemic subsides. Unless we see a drastic increase in the number of homes that come on the market for sale, we will certainly see home prices continue to rise throughout 2020.

Questions? Comments? Concerns? Let us know:

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